The DTI wants action, but it's not down to the DTI or the industry lobbyists. MPs must rule on the Construction Act review - if they can find the time
In this column on 17 February, I said I would discuss the political pressures that might lead to action on the government's review of the Construction Act (page 37). In fairness to ministers at the DTI, they seem committed to action. Construction minister Alun Michael spoke strongly at the latest DTI consultative seminar last month and the officials in his construction unit have been working tirelessly on drafts and redrafts. A sounding board of impartial advisers has been set up and has met twice. DTI ministers are wholly in favour of preparing a regulatory reform order to put before parliament later this year. If left to the DTI, there would be some action.
However, it is not just left to the DTI. The review was originally commissioned by chancellor Gordon Brown in his 2004 Budget speech, following intense lobbying by specialist contractors. He may be prime minister within 12 months, so such issues will have a pretty low priority in his in-tray. Even if he finds time to continue with parliamentary action, there are many pitfalls in the way.
The first is getting the details sorted out. They are complex and there could be unforeseen side effects. It is vital that as many of these as possible are spotted in advance. A regulatory reform order cannot be amended by parliament. It can only be approved or rejected. While some of the review proposals can be dealt with by a regulatory reform order, others would require new legislation. That also needs careful drafting and it will have to take its place in the queue of government priorities. It would not hold high place at present.
Then there are the conflicts within the industry itself. The specialist contractors are mainly interested in the payment proposals. They want the government to go much further than it has indicated so far. The main contractors have always taken the view that the 1996 act was an acceptable compromise, which does not need to be altered. If more guidance is needed on best practice, they argue, fair enough. But do not upset procedures that work satisfactorily and are understood in the industry. Conversely, the main contractors and the consultants wish the government to go further with its adjudication reforms.
That brings us to the real decision-makers, who are the members of parliament. Unless one has been an MP, it is hard to envisage the pressures on elected representatives. In my time in the House, 1974 to 1992, I received 30 to 40 letters every day. Most of them were from constituents about their personal problems and I saw about a dozen people at my advice bureau every fortnight. MPs deal with scores of different issues every day and nowadays they also receive streams of emails.
There will be a great temptation for MPs to slow the process down in the hope that it will go away
The reality for MPs is that their priorities are decided by constituency pressures. If hundreds of people are contacting them about a threat to a local hospital or some controversial road scheme, MPs will react strongly, with letters to ministers, parliamentary questions or will even seek to raise a backbench debate, which will receive heavy publicity on local radio, television and local newspapers. That is how MPs actually work, through democratic pressures on them.
Issues that are not in their in-trays receive much lower priorities. The construction industry knows this, so both the main contractors and the specialists will have been lobbying for months to keep these issues before their MPs. The problem for the MPs is that the pressures are conflicting. Some constituents are urging more action on payment; others are saying leave it alone.
Bearing in mind that most MPs will have no detailed - or even rudimentary - knowledge about payment problems in the industry, and they also have dozens of other issues to deal with every day, there will be a great temptation for them to slow the whole process down in the hope that it will just go away. They will think, why should I bother about this? There are no votes in it. It is entirely an industry matter. It is all too much hassle. Let them sort it out.
Only time will tell which pressure will be more decisive. At the end of the day, raw politics will decide.